SOCIAL SECURITY ADMINISTRATION
SOCIAL SECURITY NUMBER
CARDS ISSUED AFTER DEATH
April 2005 A-06-03-13078

AUDIT REPORT

Mission

We improve SSA programs and operations and protect them against fraud, waste,
and abuse by conducting independent and objective audits, evaluations, and
investigations. We provide timely, useful, and reliable information and advice
to Administration officials, the Congress, and the public.

Authority

The Inspector General Act created independent audit and investigative units,
called the Office of Inspector General (OIG). The mission of the OIG, as spelled
out in the Act, is to:

Conduct and supervise
independent and objective audits and investigations relating to agency programs
and operations.
Promote economy, effectiveness, and efficiency within the agency.
Prevent and detect fraud, waste, and abuse in agency programs and operations.
Review and make recommendations regarding existing and proposed legislation
and regulations relating to agency programs and operations.
Keep the agency head and the Congress fully and currently informed of problems
in agency programs and operations.

To ensure objectivity, the IG Act empowers the IG with:

Independence to determine
what reviews to perform.
Access to all information necessary for the reviews.
Authority to publish findings and recommendations based on the reviews.

Vision

By conducting independent and objective audits, investigations, and evaluations,
we are agents of positive change striving for continuous improvement in the
Social Security Administration's programs, operations, and management and in
our own office.

MEMORANDUM

Date: April 20, 2005 Refer To:

To: The Commissioner

From: Inspector General

Subject: Social Security Number Cards Issued After Death (A 06 03 13078)
OBJECTIVE

Our objective was to determine whether the Social Security Administration
(SSA) complied with its policy concerning the issuance of original and replacement
Social Security number (SSN) cards for individuals who were deceased.

BACKGROUND

Each year, SSA processes millions of applications for SSN cards. Of the more
than
16 million applications processed each year from Fiscal Years (FY) 1999 through
2002, over 11 million were replacement cards. SSA recognizes that, over time,
the SSN has become a primary means of identification in both the public and
private sectors and that, as use of the SSN has grown, so has identity fraud.
To this end, SSA has a role in combating identity fraud through the prevention
and detection of SSN misuse.

Under limited circumstances,
SSA may assign an original SSN after a person’s
death. For example, according to SSA’s Program Operations Manual System
(POMS), SSA will assign an original SSN if one is needed for health insurance
claims filed on behalf of a deceased child. SSA does not reassign an SSN after
the numberholder's death.

Before SSA’s policy change in November 2002, SSA could issue replacement
cards on behalf of deceased individuals. SSA controlled the issuance of these
cards by having them sent to the field offices that processed the applications.
Field offices were required to record the SSN card request in a security log
and deface the card with the word “Deceased” before forwarding
the card to the requestor. Effective November 2002, SSA amended its policy
and eliminated the provision that allowed the issuance of replacement cards
on behalf of deceased individuals. The amended policy states that SSA can offer
to provide verification, such as third-party verification, an SSN verification
printout, or instructions on how to obtain a numerical identification (Numident)
record; however, a replacement card will not be issued.

We identified 12,082 instances
from December 1987 through November 2003 where SSA issued SSN cards although
a
date of death was recorded in the numberholder’s
Numident record. Our review focused primarily on these transactions. In September
2004, we identified another 420 SSN cards issued from December 2003 through
August 2004 to identify the total number of cards issued after the policy change
in November 2002. We did not select any of these additional cases for detailed
review. The chart below summarizes these 12,502 issuances by fiscal year.
Death entries are sometimes posted in error to an individual’s Numident
record. If this occurs and the individual requests a replacement SSN card,
field office personnel should review the Application for a Social Security
Card (Form SS-5) and determine the validity of supporting identity documents.
If sufficient proof of identity is provided, SSA personnel should remove the
death entry, then certify and enter the applicant information into SSA’s
Modernized Enumeration System (MES). The applicant information then undergoes
numerous automated edits to further validate the information. If the applicant
information passes all of these edits, MES issues an SSN card. Appendix B provides
the scope and methodology of our review.

RESULTS OF REVIEW

Of the 12,082 cards SSA
issued between December 1987 and November 2003 although a date of death was
recorded in
the numberholder’s Numident record, 13
were original SSN cards and 12,069 were replacement cards. Nothing came to
our attention to indicate the 13 original cards issued on behalf of deceased
individuals were not in compliance with SSA policy. However, we found that
SSA did not comply with its policy on controlling or issuing replacement cards
when SSA’s records indicated the numberholder was deceased. While these
issuances represented a very small percentage of the cards processed each year,
the risk that even a few cards might be issued to individuals who may intend
to use someone else’s identity is a matter of increasing concern.

We analyzed trends for the 12,069 replacement cards and reviewed SS 5 documentation
for a selected number of the cards. We found SSA continued to issue SSN cards
containing the SSNs of individuals who were listed as deceased, even after
its policy change in November 2002. We also noted that SSA issued replacement
SSN cards to questionable applicants, including some who were issued multiple
replacement cards; paid over $1.6 million in survivor benefits to auxiliaries
of apparently living individuals; and accepted questionable proof of identity
documents when it processed applications for replacement cards. In these instances,
SSA did not correct discrepancies in the Numident record when it had information
to indicate its records contained errors.

Although SSA had MES procedures
to alert employees of conflicts between application and Numident information,
the procedures did not prevent employee error. By
promptly correcting erroneous death information or ensuring replacement cards
are not issued on deceased individuals’ SSNs, SSA can lessen the risk
it will enable identity fraud and reduce the likelihood of improper survivor
payments.

REPLACEMENT CARDS ISSUED AFTER POLICY CHANGE

In November 2002, SSA amended its policies and procedures to eliminate provisions
allowing for the issuance of replacement cards against SSNs of deceased individuals.
Contrary to this policy, SSA continued to issue replacement cards with SSNs
of deceased individuals. From December 2002 to August 2004, SSA issued 1,068
replacement cards with SSNs of individuals whose Numident record contained
a date of death. We did not perform a detailed review of these 1,068 issuances.
However, we did review a random sample of 30 replacement cards issued in FY
2003, including 27 issued after the policy change. In 21 of 27 cases, SSA determined
the numberholders were deceased but still issued the replacement cards.
QUESTIONABLE APPLICANTS FOR ASSIGNED SSNs

To determine whether obvious
discrepancies existed between information in the applications for replacement
SSN cards
and information recorded in the
Numident’s death entries for the 12,069 replacement cards, we compared
the first name, last name, and date of birth on the Numident death entry to
the Numident replacement card entry. This comparison identified 537 replacement
card issuances where the name and date of birth information provided on the
application did not match the information of the deceased person listed in
SSA’s records. SSA is required to apply basic verification standards
to the applicant’s name and date of birth when the identifying information
provided does not exactly match the Numident record.

In 401 of these cases,
the applicant’s date of birth was more than 6
years different than the date of birth that appeared in the numberholder’s
Numident death entry. In some cases, the difference in dates of birth exceeded
90 years. Although it appeared the individuals requesting these replacement
cards were not the actual numberholders, SSA personnel approved the applications
without addressing the discrepancies. Appendix C provides examples of differences
in dates of birth for some of the 537 instances in which the replacement card
information did not match the Numident death entry. Appendix D summarizes these
occurrences by the year of issuance.

MULTIPLE REPLACEMENT CARDS ISSUED AGAINST THE SAME SSN

From the 12,069 replacement
cards discussed above, we found SSA approved and issued 2 or more replacement
cards
to 378 individuals after a date of death
was posted on SSA’s records for those individuals.

Number of Individuals Issued Multiple Replacement
Cards Although a Date of Death was Recorded in
The Individual’s Numident Record

Seventy-one of these individuals
were issued three or more replacement cards. We requested and reviewed the
SS-5 applications for these 71 individuals and
determined that 62 had applied for the replacement cards on their own behalf.
The SS-5 applications also indicated that SSA accepted the proofs of identity
offered by the applicants. However, the SSA personnel who processed the applications
did not remove the death entry from the individual’s Numident record.

QUESTIONABLE SURVIVOR BENEFIT PAYMENTS

SSA paid $1.6 million in
survivor benefits to auxiliary beneficiaries for 19 of the 71 individuals
who applied
for and received 3 or more replacement
cards after the death entry was posted on their Numident record. The SS-5 applications
indicated that these individuals applied for a replacement card on their own
behalf, and SSA field office personnel verified and confirmed their identities.
In 15 of the 19 cases, SSA approved the applications and issued replacement
cards at the same time survivor benefits were being paid to the applicant’s
auxiliary beneficiaries. In these 15 cases, SSA paid nearly $720,000 in benefits
after it verified the identity of the allegedly deceased numberholder. In all
19 cases, either the survivor payments were improper and should have been terminated
when the replacement card applications were processed or SSA mistakenly issued
SSN cards to someone other than the proper numberholder.

For example, one allegedly
deceased individual had three children who received a total of $151,480 in
survivor
benefit payments from December 1995 through
December 2004. Two of these children (12-year-old twins) received more than
$8,600 each in annual survivor benefits—which will continue through 2010.
However, in January 1999, September 2000, April 2003, and June 2004, SSA approved
applications for replacement cards submitted by someone who claimed to be the
allegedly deceased numberholder.

We did not independently determine whether any of these individuals were actually
alive because SSA field offices had already documented multiple verifications
of identity for each of these individuals. The example provided above is the
only instance we found where survivor benefits were still being paid at the
time of our review. We referred this case to our Office of Investigations.
Appendix E illustrates the survivor payments made to auxiliaries of the 19
allegedly deceased individuals, the years benefits were paid, and the years
in which replacement cards were issued.

SSA ACCEPTED QUESTIONABLE PROOF OF IDENTITY

Before issuing replacement
cards, SSA requires that applicants confirm their identity by submitting
one or
more documents that show the person’s name
and provide biographical information (age, date of birth, or parent’s
name). The reviewer can compare the document with data on the application and/or
the applicant’s physical characteristics (for example, hair or eye color).
Acceptable forms of identity documents include current driver’s license,
employee identification card, military identification, or school identification
card.

In addition to the SS-5s we requested for the 71 individuals who were issued
3 or more replacement cards, we requested and reviewed SS-5 applications for
30 randomly selected individuals who were issued replacement cards in FY 2003.
We reviewed
233 SS-5 applications for these 101 individuals. We found that SSA employees
approved issuance of many of these cards after accepting documentation that
did not appear to sufficiently establish the identity of the individual who
requested the card.

• In 23 instances, either no evidence of identity was documented on
the application or the evidence documented was items that, according to POMS, “…should
not be accepted as adequate by themselves to establish identity for SSA purposes.” Documentation
SSA accepted as proof of identity for these applications included library cards,
voter registration cards, hunting licenses, and utility bills.

SSA’s MES has controls to alert employees when requests for replacement
cards may conflict with information in its records. When a conflict occurs,
MES sends a system-generated feedback message to alert employees of the discrepancy
in the applicant’s information. The feedback messages for death discrepancies
require that a manager enter his or her personal identification number for
resolution. However, the employee can still process and issue the replacement
card without clearing the death entry from the Numident record. In such cases,
MES does not regenerate a feedback message to alert the field office to resolve
the incorrect information. The continued issuance of replacement cards after
November 2002—although the individual is listed as deceased—reflects
a continuing vulnerability with SSA’s process.

CONCLUSION AND RECOMMENDATIONS

SSA did not comply with
its policy concerning the issuance of replacement cards when its records
indicated the
individual was deceased. While the number
of such cards issued is small in relation to the total number of SSN card applications
processed each year, the risk of issuing cards to the wrong individuals is
magnified by the potential for identity fraud. SSA amended its policy to prohibit
the issuance of replacement cards for deceased individuals, but cards were
still issued after the November 2002 policy change. In addition, SSA issued
replacement SSN cards to questionable applicants, paid survivor benefits to
auxiliaries of apparently living individuals, and accepted questionable identity
documents. SSA can minimize the risk that it serves as an enabler for identity
fraud, as well as reduce the likelihood of improper payments, by ensuring replacement
cards are not issued on deceased numberholders’ accounts, and by promptly
resolving discrepancies between information provided by applicants for replacement
cards and information appearing in SSA’s records.

We recommend that SSA:

1. Ensure compliance with SSA policy concerning the issuance of replacement
SSN cards for individuals whose record indicates they are deceased.

2. Determine whether information needs to be corrected in the individual records
associated with the questionable issuances identified within the report. SSA
should refer any potentially fraudulent cases to the Office of the Inspector
General for investigation.

3. Determine the appropriateness
of current survivor payments being made under the individual’s account
discussed in the report.

4. Review its procedures
for paying survivor’s payments to auxiliaries
when evidence indicates that the numberholder is not deceased.

AGENCY COMMENTS

SSA agreed with our recommendations
and provided technical comments that we incorporated into the final report.
See Appendix F for the text of SSA’s
comments.

APPENDIX D – Replacement Social Security Number Cards Issued by Fiscal
Year where Name and Date of Birth Information Provided was Inconsistent with
the Numberholder’s Numident Record

APPENDIX E – Survivor
Benefits to Auxiliaries of Numberholders Who Applied for Replacement Cards
After Recorded
Date of Death

APPENDIX F – Agency
Comments

APPENDIX G – OIG
Contacts and Staff Acknowledgments

Appendix A
Acronyms

FY Fiscal Year
MES Modernized Enumeration System
Numident Numerical Identification
POMS Program Operations Manual System
SSA Social Security Administration
SSN Social Security Number

Forms
SS-5 Application for a Social Security Card

Appendix B
Scope and Methodology

To accomplish our objective, we:

• Reviewed the Social Security Administration’s
(SSA) policies and procedures related to the Modernized Enumeration System
(MES) and prior
Office of the Inspector General and Government Accountability Office reports
pertaining to enumeration.

• Visited an SSA
field office to view the enumeration process and interview field office staff
regarding
procedures used in issuing a Social Security number
(SSN) card.

• Extracted all 12,082 cases from SSA’s numerical identification
(Numident) record where a date of death was posted to an individual’s
record and an SSN card was issued after the posted date of death. Of these,
13 were issued as original cards, and 12,069 were issued as replacement cards.
We examined these issuances to determine

whether there were notable
differences between information in the application and information in SSA’s
records and

the number of times replacement
cards were issued under the same SSN.

• Performed a similar
data extract in September 2004 for the period December 2003 through August
2004.
This extract identified another 420 replacement
card issuances. We did not select these cases for testing. However, we did
consider these transactions when identifying the number of cases since the
November 2002 policy change prohibiting issuance of replacement cards on behalf
of deceased individuals.

• Determined whether obvious discrepancies existed between information
in the applications for replacement SSN cards and information recorded in the
Numident’s death entries. We compared the first name, last name, and
date of birth on the Numident death entry to the Numident replacement card
entry for the 12,069 replacement cards issued from December 1987 through November
2003.

•
Requested 265 Applications for a Social Security Card (Form SS-5) from SSA’s
Office of Central Operations, Center for Material Resources for 101 individuals.
SSA provided, and we reviewed, 233 of the 265 SS-5s for 101 individuals including:

71 individuals who had
been issued 3 or more replacement cards after the date of death posted to
their Numident record, and

30 randomly selected individuals
who were issued replacement cards in Fiscal Year 2003.

We conducted our audit
between July and October 2004 at SSA’s Regional
Office in Dallas, Texas. The entity audited was the Office of the Deputy Commissioner
for Operations. We conducted this audit in accordance with generally accepted
government auditing standards.

Subject: Office of the
Inspector General (OIG) Draft Report "Review of
Social Security Number Cards Issued After Death" (A-06-03-13078)--INFORMATION
We appreciate OIG’s efforts in conducting this review. Our comments on
the draft report recommendations are attached.

Please let me know if you have any questions. Staff inquiries may be directed
to
Candace Skurnik, Director, Audit Management and Liaison Staff, at extension
54636.

Attachment:
SSA Response

COMMENTS ON THE OFFICE
OF THE INSPECTOR GENERAL DRAFT REPORT "REVIEW
OF SOCIAL SECURITY NUMBER CARDS ISSUED AFTER DEATH" (A 06-03-13078)
Thank you for the opportunity to review and comment on the draft report contents
and recommendations. We agree that the prevention and detection of Social
Security number (SSN) misuse is vital in combating identity fraud. The Social
Security Administration (SSA) has taken several steps to improve the integrity
of the enumeration process that include:

• Creating an interface
between Title II and Title XVI claims and the Numident record to alert the
field
office (FO) if a death is posted to the
Numident. Management clearance is needed to override the alert and permit adjudication
of the claim.
• Creating an enumeration message (EM) that is sent to interrupt the processing
of an SS-5 application when death data is present on the Numident. The FO is
instructed to review SSA records and management clearance is required to clear
the application.

We will continue to make every effort to address policies and procedures that
are not being followed and address ways to reduce the risk of paying benefits
improperly. We are currently working on changes to the enumeration system,
and will determine if it is feasible to include in those changes a process
that prevents issuance of an SSN replacement card if death data is present
on the Numident.

Finally, it should be noted that of the 537 cases identified in Appendix D
where replacement cards were issued in spite of inconsistencies in the name
and date of birth, only 15 cases occurred in 2002 after we changed our policy
for issuing SSN replacement cards on behalf of deceased numberholders. This
reflects a significant improvement in our performance in reducing the risk
of potential identity fraud.

Below are our responses to the recommendations as well as technical comments
to enhance the accuracy of the report.

Recommendation 1

SSA should ensure compliance with policy concerning the issuance of replacement
SSN cards for individuals whose record indicates they are deceased.

Response

We agree. We currently have policies and procedures in place that provide
an alert
(EM 16 – Investigate Message) to interrupt the issuance of replacement
cards to deceased individuals when the record of death has been posted to SSA
records. Prior to implementation of the EM 16 alert, there were no systems-generated
alerts. To address the current policy compliance issue, we will issue an Administrative
Message (AM) with reminders to our FO employees on the procedures for issuing
SSN cards when the numberholder is deceased. We expect to issue this AM in
April 2005.

We will also include within a future Enumeration Essentials Interactive Video
Training broadcast refresher training on FO issuance of replacement SSN cards
for individuals whose Numident records indicate they are deceased. The next
broadcast is tentatively scheduled for Spring/Summer 2005.

Finally, as noted above, we are currently exploring plans for redesigning
the Modernized Enumeration System to build in additional safeguards to prevent
the processing of an SSN replacement card transaction if a death indicator
is present on the Numident.

Recommendation 2

SSA should determine whether information needs to be corrected in the individual
records associated with the questionable issuances identified within the report.
SSA should refer any potentially fraudulent cases to the OIG for investigation.

Response

We agree. We will investigate the cases identified in the report and make
referrals to OIG where it is appropriate.

Recommendation 3

SSA should determine the
appropriateness of current survivor payments being made under the individual’s
account discussed in the report.

Response

We agree. As with recommendation number 2, we will also review the cases identified
to determine if current survivor benefit payments should have been paid. It
should be noted that the case cited in the report has been forwarded to OIG
for investigation.

Recommendation 4

SSA should review its procedures for paying survivors payments to auxiliaries
when evidence indicates that the numberholder is not deceased.

Response

We agree. We will review our procedures to ensure that discrepancies are promptly
resolved when information provided by applicants for replacement cards and
information in our records conflict.
Appendix G
OIG Contacts and Staff Acknowledgments
OIG Contacts

Paul Davila, Director, (214) 767-6317

Ron Gunia, Audit Manager, (214) 767-6620

Acknowledgments

In addition to those named above:

Joshua Campos, Auditor

Brennan Kraje, Statistician

Kimberly Beauchamp, Writer-Editor
For additional copies of this report, please visit our web site at www.socialsecurity.gov/oig
or contact the Office of the Inspector General’s Public Affairs Specialist
at (410) 965-3218. Refer to Common Identification Number A 06 03 13078.

Overview of the Office of the Inspector General
The Office of the Inspector General (OIG) is comprised of our Office of Investigations
(OI), Office of Audit (OA), Office of the Chief Counsel to the Inspector General
(OCCIG), and Office of Executive Operations (OEO). To ensure compliance with
policies and procedures, internal controls, and professional standards, we
also have a comprehensive Professional Responsibility and Quality Assurance
program.

Office of Audit

OA conducts and/or supervises financial and performance audits of the Social
Security Administration’s (SSA) programs and operations and makes recommendations
to ensure program objectives are achieved effectively and efficiently. Financial
audits assess whether SSA’s financial statements fairly present SSA’s
financial position, results of operations, and cash flow. Performance audits
review the economy, efficiency, and effectiveness of SSA’s programs and
operations. OA also conducts short-term management and program evaluations
and projects on issues of concern to SSA, Congress, and the general public.

Office of Investigations

OI conducts and coordinates investigative activity related to fraud, waste,
abuse, and mismanagement in SSA programs and operations. This includes wrongdoing
by applicants, beneficiaries, contractors, third parties, or SSA employees
performing their official duties. This office serves as OIG liaison to the
Department of Justice on all matters relating to the investigations of SSA
programs and personnel. OI also conducts joint investigations with other
Federal, State, and local law enforcement agencies.

Office of the Chief Counsel to the Inspector General

OCCIG provides independent legal advice and counsel to the IG on various matters,
including statutes, regulations, legislation, and policy directives. OCCIG
also advises the IG on investigative procedures and techniques, as well as
on legal implications and conclusions to be drawn from audit and investigative
material. Finally, OCCIG administers the Civil Monetary Penalty program.

Office of Executive Operations

OEO supports OIG by providing information resource management and systems security.
OEO also coordinates OIG’s budget, procurement, telecommunications, facilities,
and human resources. In addition, OEO is the focal point for OIG’s strategic
planning function and the development and implementation of performance measures
required by the Government Performance and Results Act of 1993.